Study Of Marketing Channel Conflict Formation And Control

In the time of China’s planned economy, national economy operating closure, plans guiding all, enterprises focusing on production regardless of sales, simple supply-purchase- underwriting model resulted in the non-existence of marketing together with low productivity and economic output. After 1970’s, along with China’s reform and opening up began in the rural areas, marketing was put into practice in China. The academic study of marketing theory and the business practice of marketing activities lead to wide spread of marketing. From the trend of global competition, competition has already turned into the one of supply chain or channel chain between enterprises. Building of channels has called more and more attention of enterprises, the industry market giants such as GE, IBM, Microsoft, etc., have established channels of cooperation to improve their global position. In the field of agriculture-related enterprises, such as COFCO Beijing, Inner Mongolia Mengniu Group, Beijing Huiyuan Juice Group, Shaanxi Saint-Saens Green Food Co., Ltd., pay more and more attention to their own channel construction, and make the building of good channel as their long-term development of core competitiveness.In research on academic theories, research on the channel has become the core of marketing theory. And researches focused on the channel structure, channel behavior, and channel relationships. Research on channel conflict belongs to the scope of channel behavior and channel relationships. In the channel conflict research, most of the scholars focused on the causes and consequences of channel conflict from the qualitative point of view, while rarely using Game Theory and empirical analysis to do quantitative analysis. In actual operation, many enterprises lack of systematic scientific approaches and solutions in the channel conflict management and maintenance of channel relations. Because of this, the paper explored to using ideas and methods of game theory, and studied the causes of channel conflict from an empirical perspective. The main research work and results are the following.1. Organized the existing researches of domestic and foreign scholars on channels and channel conflict, fully understood and knew the real meaning of“having channels, win the world”, understood the importance of channels in marketing theory and practices, recognized the influence of channel conflict on value chain; learned and organized scholars’research on the channel conflict on the point of view, focus, methods, results and insufficient to select and determine the point of this research and the research methods used, and figure out the innovation of this paper.2.“Channel”in channel conflict attributed to the theory of marketing channels, and "conflict" attributed to the conflict theory. Thoughts of game were based on game theory. From an economics point of view, the behavior of channel members meet the transaction cost theory, therefore, marketing channel theory, conflict theory, game theory and transaction cost theory, agency theory, relationship marketing theory formed the theoretical basis of the thesis. The other hand, for channel conflict itself, the paper analyzed the main performance of channel conflict, the reasons for the formation of channel conflict, the impact of channel conflict, channel power and channel control.3. Analyzed channel conflict by using game theory. Static game, Prisoner’s Dilemma model analyzed the essential of vertical channel conflict, and recognized the loss made by channel conflict to gains of a whole channel. Based on this, through analyzing the manufacturing business dominated dynamic game model, found that manufacturers using exclusive information eroded the profits of retailers, resulting in a vertical channel conflict, and conducted empirical analysis of agriculture-related enterprises as an example of verification. Based on the method expressed by the tragedy of commons model of complete information static game model, demonstrated the inevitability of horizontal channel conflict in the condition of individual interest-orientation of horizontal channel members, then analyzed the production process and harm of the horizontal channel conflict by using Hotelling model. Fleeing-goods is the major manifestation of horizontal channel conflict. This paper conducted game analysis of benefits and costs of horizontal channel members by establishing fleeing-goods model, and explained the cause of fleeing-goods.4. Based on using game theory to analyze nature of channel conflict, that is the individual interests of member-oriented and summarizing theoretical causes of channel conflict, the paper extracted the major variables affect channel conflict: objective differences, role differences, perceived differences in expectations, communication difficulties, channel structure, the level of conflict and the relationship of the variables. The paper proposed the hypothesis by theoretical analysis, built up the conceptual model of relationship of the variables, measured them with Likert 5-level scores, and carried on the real diagnosis of the main reasons of the channel conflict by using questionnaire data from agriculture-related enterprises and SPSS statistical software.5. After clarifying control objectives, principles, processes and procedures of channel conflict, the paper proposed a control strategy of channel conflict corresponding to game analysis from game analysis and empirical research on the effects of channel conflict and the formation mechanism. The control strategy is the control strategy of vertical channel conflict based on market-based control, fare increases and rebates, and relationship commitment. The control strategy is the control strategy of horizontal channel conflict based on channel management control and the use of channel power as well as the strategic alliance-based control strategy for fleeing-goods. The paper also put forward correspondent control strategies for different impacts on channel conflict made by the main variables.6. In the condition of making example of agriculture-related enterprises, a prominent feature of channel value chain is "farmers’characteristics" at the end of a reverse channel. At the end of a reverse channel, there are farmers, fruit producers and herdsmen who provide grain and oil-bearing crops for food groups like COFCO, the agriculture-related enterprises. If the channel relationship is harmonious and price is reasonable, the interests of consumers and more importantly, the interests of food, fuel, livestock producers or farmers are protected. This is the ultimate purpose of this paper choosing agricultural enterprise as an example and studying channel conflict and how to control the conflict.